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The Environmental Impact of a Transition to On-Demand Knitwear

Comparing the Bulk Supply Chain to the On-Demand Supply Chain of a Knitted Jumper

The Environmental Impact of a Transition to On-Demand Knitwear

Comparing the Bulk Supply Chain to the On-Demand Supply Chain of a Knitted Jumper

Samenvatting

The study was conducted in commission of New Industrial Order (N.I.O), a laboratory for Fashion-On-Demand based in Amsterdam. A knowledge gap in literature was identified concerning the environmental performance of On-Demand manufacturing. To fill the gap, a preliminary Life Cycle Assessment was initiated, comparing a Bulk supply chain, modelled on a potential client of N.I.O, to an On-Demand supply chain of a knitted jumper. Characteristic of a Bulk supply chain is the existence of overstock, which connotes negative environmental impact. The study’s purpose was to give N.I.O further in-depth knowledge of the environmental impact of their business concept in relation to their potential client’s. The main research question formulated for this study reads: What is the environmental implication of exchanging Bulk manufacturing for On-Demand manufacturing?
To balance and cross check information, the study combined qualitative and quantitative methods, such as:


a review of literature


semi-structured interviews with stakeholders across the supply chain


a preliminary Life Cycle Assessment based on the ISO 14040&14044
guidelines The study’s initial results showed a relatively small difference between the Bulk jumper and the On-Demand jumper. The On-Demand jumper results were even found to be higher in the categories Climate Change and Primary Energy Content compared to the Bulk jumper. This was due to the higher impact of the plastic carrier bag in Packaging and the use of Air Freight in Transport. To this end, a Sensitivity Analysis (SA) was performed on four topics:




SA 1 focused on the effect of different product distribution routes within the Bulk supply chain


SA 2 researches alternative On-Demand Packaging Material


SA 3 mapped out On-Demand Transport scenarios (P1, P2, P3, P4)


SA 4 looked into applying Economic Allocation of Overstock








The study found that the Unsold stock Distribution route has a higher impact in the Climate Change impact category than both the Bulk Retail Route and the On-Demand Scenario, due to the extra transport that is needed to distributed the overstock to other markets. The study also showed a favorable outcome if the packaging material in the On-Demand supply chain would reduce its use of plastic by switching to paper-based material. As for Transport, the results support a reduction of impact when production is moved closer to the demand, however a more profound decrease in environmental impact was seen by substituting the use of Air Freight for Truck. A trade off in delivery time extension will be an additional effect.
The study can conclude that the implementation of economic allocation to adjust the Bulk scenario with adding the ‘avoided impact’ of overstock showed a positive outcome for the On-Demand jumper supply chain. The Bulk scenario with ‘avoided impact’ reported an increased impact of between 10 and 17% across all the impact categories. Based on this scenario, the study has shown that exchanging Bulk manufacturing for an On-Demand manufacturing strategy would result in a reduction in environmental impact.
While the study used Economic Allocation to include the factor of Overstock, a misalignment has been observed with relationship between the level of environmental impact and economic value due to the exclusion of consumer behavior influence. The study therefore requires further research and recommends adopting another research method for the same comparison: Eco-costs/Value Ratio. The purpose of EVR is to match the value of a product or service

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OrganisatieSaxion
OpleidingMaster Innovative Textile Development
Datum2021-04-01
TypeMaster
TaalEngels

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